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Keys To Protecting Your Business From Litigation

As being a business leader, likelihood is you're alert to the risks linked to litigation. Together with the great number of local, federal and state regulations, you will find ample the possiblility to enter into trouble if a person isn't aware and also.

So, do you know the most typical reasons for potential litigation - and just what steps could you will take to avoid (or at best minimize) their impact?

The most typical legal issues originate from other places you take care of normally, including:

Employee-related lawsuits Business-to-business litigation Breach of contract disputes Ip disputes Of the above, employee-related lawsuits are most popular. In accordance with the EEOC, employee-related lawsuits comprise almost 75% of most suits filed against businesses today, with 40% of most employment practice claims filed against private employers with between 15 and 100 employees.

What might you do in order to minimize your risk of these specific areas?

Employee-related litigation

Have a very documented employee handbook detailing expectations and policies including: Compensation A day off Disciplinary processes Grievance procedures Employee performance review policies and schedules Be consistent with employee treatment. Attempting to be compassionate or help a deserving employee which has designed a mistake is setting a precedent that will returning to haunt you. Train your managers and supervisors in most areas of employee interface including: What you can/can't ask in an interview EEOC policies Sexual harassment laws Privacy standards and practices Create and manage personnel files containing all pertinent data including performance appraisals and any warnings or notifications of poor performance. Evaluate honestly and consistently. Among the most difficult things for managers is usually to discuss substandard performance with an employee. Documenting clearly where a staff is just not meeting expectations, and documenting a performance improvement plan with clear goals and milestones can be quite a distance in preventing unlawful discharge lawsuits. Having poor documentation of poor performance and terminating a staff is probably the most common (and costly) mistakes. Communicate regularly with all levels of employees. Encourage an "open door" policy. Ensure that your management team understands why you have an empty door policy so they really don't consider it as a threat or feel undermined. Business-to-business litigation

Joint ventures, outsourcing, and other types of partnership arrangements are a way to help keep costs down while sharing expertise. Again, planning and documentation around the nose can minimize problems as time goes on. These agreements must be a win/win either way parties or they invariably come unraveled. Here are some steps to ensure success in this field:

Focus on a clearly documented statement of labor detailing expectations of each party. Deficiency of upfront preparation is a type of pitfall. Commonly a company doesn't know every one of the expectations whenever they enter an agreement, in order that they purposely let it rest vague. The statement of training should outline clear goals, timed milestones and deliverables, and outline regular review meetings scheduled to go over progress. The actual agreement should contain, at the least: A procedure to update the statement of training for all those items which are missed in the original document, along with a process for schedule and value adjustment. A documented process for addressing substandard performance with a pre-agreed upon cure period. Being dumped clause whereby, if all else fails, either party gets the option to terminate the agreement with proper documentation and notice, with termination costs clearly detailed. Confidentiality as well as a non-compete agreement that stops unauthorized usage of confidential material gained from the partnership. Be fair and open using the partner. A small business partnership looks like a marriage and really should be approached sticking with the same openness and communication for it to work well for both parties. Breach of Contract Litigation

Many of the areas that will protect you with breach of contract litigation are covered in the sections above. Be clear and honest relating to your expectations. Document deliverables and milestones. Communicate and review progress regularly. Ensure you have competent legal council review all documentation and invest time to comprehend it. Don't assume because your lawyer looked at it, so it's fine. You understand your company and expectations much better than anyone. Don't depend on your attorney alone to totally understand your preferences or concerns.

Intellectual Property Litigation

There's two areas that cause most ip issues:

Shared IP: In joint ventures or outsourcing agreements where existing IP is shared, be sure ownership is clearly defined as along with what the non-owning party is entitled to apply the IP. Even property paid by patent or trademark is offered to risk by the party "reverse engineering" another companies work. Protect yourself with a strong non-compete agreement for a period of time as soon as the termination in the partnership. Ownership: Make certain it's clearly understood who owns any IP developed during a partnership. If you're a manager, ensure that your employment agreement clearly defines online resources any IP manufactured by an organization employee on their employment period. Most litigation may be prevented by good due diligence and documentation for the front end, consistent putting on policy, and open communication. Using a good working relationship with an attorney that understands your small business may also be invaluable.

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